Tenaris was a stand out among the gainers, with investors citing comments from the group's chief executive Paolo Rocca who raised forecasts for the oil and gas tubes market, fuelling talk of possible earnings upgrades.

Wolseley was another top European gainer, up 5.1 per cent after posting a 25 per cent rise in profit for its first half, driven by strong growth in the United States.

Portuguese oil company EDP rose 4.2 per cent after it said it would buy the rest of its renewable energy subsidiary EDP Renovaveis.

Portugal's largest company also agreed the sale of its Spanish gas distribution network Naturgas to Nature Investments, a special purpose vehicle owned by a consortium of institutional investors.

EDPR jumped 10.1 per cent on the news, helping Portugal's stock index outperform European peers, up 2.7 per cent.

Dufry, the Swiss airport retailer, gained 3.5 per cent after a report said Chinese conglomerate HNA was in talks to buy a stake, a move which would extend Dufry's reach in China.

Banco Popular was up 3.2 per cent after a Spanish newspaper report said the bank's new head Emilio Saracho was in talks to sell the lender's property portfolio and a stake to Libra Group.

Both declined to comment.

Credit Agricole, meanwhile, rose 3.8 per cent, to the top of France's blue-chip index after Barclays switched its preference to it from Societe Generale.

Among the fallers, Recordati fell 0.9 per cent after Goldman Sachs cut its rating on the stock to "sell".

The Italian pharmaceuticals company's premium to peers is excessive, Goldman analysts said, given a slightly more risky research and development profile due to early-stage clinical partnerships, and their belief that mergers and acquisitions could be less pronounced ahead.

Recordati plans around 40 per cent of sales growth to come from reinvestment in M&A in 2017-2019. But Goldman said the company's market capitalisation of 6.6 billion euros (S$9.97 billion) made it harder for bolt-on acquisitions to move the needle.

Wholesaler Booker was also among top fallers, down 0.9 per cent after two major Tesco shareholders opposed a US$4.7 billion takeover deal by the retailer, saying it would destroy value.